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Bitcoin Startup BitMari to Partner with African Commercial Bank

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BitMari

BitMari, a Zimbabwe-based bitcoin wallet provider and remittance service, recently applied for a remittance license from the Reserve Bank of Zimbabwe. The bitcoin startup aims to tap into agricultural-related remittances in the region. BitMari has already partnered with the Zimbabwe Bank of Agriculture in rolling out its blockchain-based accelerator for women farmers in Africa. The new license will see it become Zimbabwe’s first bitcoin-based remittance service.

BitMari set to Revolutionise International Remittances for African Farmers

In the past, Africa has recorded the highest number of people who do not have access to financial services. However, this is beginning to change as a wave of innovation sweeps across the continent, with technology being a key driver of financial inclusion. Bitcoin has been successful in improving the penetration of financial services in Africa, with companies such as BitPesa, and other cryptocurrency startups flourishing in several nations.

BitMari has been at the forefront of advocating for blockchain-based solutions as a means to achieve political change. In a 2016 interview with Ebony Magazine, BitMari co-founder, Sinclair Skinner was adamant that technology was a better solution for many of the continent’s problems than politics.

Building on its philanthropic programs targeting female farmers, BitMari hopes to offer superior money remittance services to the African economy, which has lost over $60 bn in exorbitant remittance fees. Farmers who export their produce see their earnings reduce when they send and receive money internationally or exchange currencies due to high fees. With the agricultural export industry accounting for 50% of Africa’s economic output, a system that allows farmers to bypass conventional banking processes and retain most of their earnings would likely quickly gain in popularity.

“Blockchain technology will allow Agribank and future indigenous African banks to leapfrog traditional remittance methods. Financial inclusion creates empowerment and ultimately stronger economies,” Skinner stated.

Regulatory Challenges

While some may argue, undeveloped financial structures in African countries, offer opportunities for cryptocurrency startups to succeed, the reverse can also be true. The lack of any substantive regulations pertaining to cryptocurrencies hampers the adoption of bitcoin in Africa.

Only a handful of countries have introduced official guidelines for businesses to operate within, the rest are either considering or have outrightly banned bitcoin usage. As BitMari continues to partner with mainstream financial institutions across Africa, the absence of regulatory guidelines could present future challenges to its business model.

Presently, everyone is focused on seeing whether BitMari’s license application will be approved and what it will mean for Africa’s financial ecosystem. In the words of Christopher Mapondera at a recent interview,

“Bitmari is utilising the wisdom of Zimbabwe and the resources of Silicon Valley to build fintech applications that will change the speed and flexibility of transactions throughout Africa”.

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The Top 5 African Countries That Are Embracing Bitcoin

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African Countries

Bitcoin tends to polarise opinions between sceptics and believers, with almost no room for the middle ground. However, there’s a substantial demand for bitcoin and other cryptocurrencies in many Africa countries.

Do a quick search on Google Trends and you will see three African countries in the top ten of global search interest for the term “bitcoin.” This is a testament to the embrace of bitcoin in a number of leading African economies.

In this guide, you will discover the five leading bitcoin economies in Africa that have the most demand for digital currency as well as the most active local cryptocurrency communities.

South Africa

south africaBitcoin is popular among South Africans. According to their search interests on Google, they top the ranking for bitcoin. One particular group bitcoin appeals to is millennials. South Africa has a lot of them. Young people between the ages of 15 to 34 years old make up 20.6 million people – 35.7 percent of the total population, according to Statistics South Africa’s 2018 mid-year population estimate report. Combined with the fact that the country has one of the highest internet penetration rates in Africa, the country has become a sweet spot for many cryptocurrency exchanges.

The online multi-asset broker, eToro, reported a 671 percent increase in new users trading between January and November 2017, and a 574 percent increase a year before. LocalBitcoins, one of the largest peer-to-peer (P2P) bitcoin marketplaces in the world, saw over 600 percent increase in trading volume between January and December 2017, according to data from CoinDance.

The latest report by Ecobank on the state of cryptocurrency regulation in sub-Saharan Africa shows only two – South Africa and Swaziland – have a favourable stance on cryptocurrencies. The bank analysed 39 African countries.

The South African Reserve Bank has stated that virtual currencies pose no significant risk to financial stability, price stability or the National Payment System.

Africa’s second-largest economy has been struggling to stand on both feet for the past two years; the economy has refused to grow. In light of this, bitcoin has become a haven from the political and economic turmoil.

Nigeria

buy bitcoin in nigeriaIn Nigeria, many local traders and activists believe this is an opportunity to liberate themselves from a flailing economy using digital currencies and blockchain technology.

The main driving force for Nigeria’s strong bitcoin adoption could be tied to the prolonged dollar shortage in the country in 2016 and 2017. The government had devalued the currency and inflation was at rising rapidly. Bitcoin was a viable means for Nigerians to work around the lack of access to foreign exchange and also preserve their money from being eroded by inflation.

In the week of August 19, 2017, LocalBitcoins’ trading volume crossed the 1 billion naira mark (about $360 million) in Nigeria. The exchange’s weekly trading volume has not traded less than that amount since then. Local crypto exchanges have also been on the rise in the country giving more people access to a broader range of cryptocurrencies.

Zimbabwe

ZimbabweThe situation in Nigeria is not too dissimilar from Zimbabwe. A cash-strapped economy, failing currency and depleted foreign exchange markets saw locals turn to bitcoin as a store of value. Golix, the leading crypto exchange in Zimbabwe, says it processed bitcoin transactions worth around $1 million during October 2017. The price of bitcoin had once risen more than double the average price in other countries in 2017.

However, in 2018, the relationship between financial regulators and crypto businesses have been strained. The Reserve Bank of Zimbabwe (RBZ) decided to ban all local financial institutions from servicing cryptocurrency businesses. There have been court cases and more back and forth between the country’s leading crypto exchange, Golix and the RBZ, but as it stands it is difficult for local exchanges to operate within the country’s borders.

Young Zimbabweans – desperate to overcome the foreign currency and liquidity challenges plaguing the country – have found innovative ways around the ban though. Recently, Cryptogem Global defied the ban and opened a branch in Zimbabwe’s capital, Harare. Remitano and LocalBitcoins have also been servicing crypto fans in Zimbabweans.

Kenya

KenyaA Citibank research in December 2017 ranked Kenya among countries with the largest bitcoin holdings worth $1.63 billion, approximately 2.3 percent of the GDP.

The East African country has one of the highest bitcoin trading volumes in Africa. The weekly trading volume on LocalBitcoins jumped by almost 429 percent in 2017 and has only dipped by 19 percent this year despite bitcoin losing two-thirds of its value.

Also, local innovators have launched cryptocurrency systems to support payments and cross-border transactions, as embodied by initiatives like BitPesa.

Kenya is also one of the few countries in Africa with a Bitcoin ATM. Others are Zimbabwe, South Africa, and Djibouti.

Ghana

buy bitcoin in GhanaGhanaians began the year 2018 with a statement from the Bank of Ghana (BOG) cautioning the public about the use of bitcoins.

The central bank also expressed an interest in introducing cyber security guidelines to guide the use of digital currencies in the country. The central bank presented a bill referred to as Payment Systems and Services Bill to the Ghanian parliament. The BOG also hailed the potential of the technology behind bitcoin, blockchain.

A report earlier in 2018 shows Paxful, one of the prominent P2P exchange in Africa, monthly bitcoin volume in Africa is now around $40 million. The company’s most active locations are Nigeria and Ghana, the second and third largest markets respectively.

There are also several local bitcoin and blockchain startups, such as Bitland and BTCGhana.

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South African Man Beaten And Tortured to Give Up Bitcoin Holdings

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A South African bitcoin trader was reportedly drugged, beaten, and tortured by assailants who wanted to gain access to his bitcoin holdings.

Facebook Invitation Led to Torture and Bitcoin Theft

According to local media, the incident happened on November 16 after the victim was invited by a man he met on Facebook to give a presentation on cryptocurrency. The same man who had invited him was present when the victim arrived with six other people in the room.

Identified only as Andrew, the victim trustingly entered the residence of his attackers in the afternoon. It was at this point that someone approached him from the back and covered his face with what is presumed to be a drug-stained cloth that knocked him out.

cryptocurrency tax regulationsAfter regaining consciousness he woke up in a different house and was surrounded by two women and three men. According to a report from the Meadowlands police, the victim was stripped of his clothing, tortured and assaulted.

Andrew also stated that the gang demanded his bitcoin password and his FNB (First National Bank) account details. All the while threatening to kill him and burning him with a hot iron if he failed to give up the information. He was at first reluctant to give up the information but gave in after they continuously tortured him.

After finally giving the details, he transferred R 800,000 ($57,789) worth of bitcoin to the account they provided him with. He also transferred a further R 100,000 ($7,224) from his bank account to their account. Apart from the bitcoin holdings and the money on the victim’s account, the robbers also got away with R 3,000 ($216.53) in cash, two laptops, and two Apple iPhones.

After the theft, the gang of robbers blindfolded Andrew and dumped him off at Kliprivier Road in Johannesburg. He is currently in the intensive care unit recovering after sustaining burn wounds on his body.

Crypto Related Crimes Are on the Rise

Unfortunately, the downside of cryptocurrencies gaining so much popularity means that people who trade in it are vulnerable to attacks. Cryptocurrency theft is a lucrative business for criminals especially since it is difficult to trace transactions.

This is not the first crime and will be a far cry from the last, as scams involving digital coin are being reported more often and violent attacks on known bitcoin holders have increased since 2017.

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Middle Eastern Bitcoin Exchange BitOasis Launches in Egypt and Morocco

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Dubai-based digital asset exchange BitOasis has announced that it has now opened its doors in Egypt and Morocco, expanding its operation to North Africa.

BitOasis Expands Into North Africa

BitOasisBitOasis has been serving the Middle East as one of the first exchanges to offer cryptocurrency trading for local currency and has now decided to expand into North Africa to provide Morrocans and Egyptians with the opportunity to buy bitcoin (BTC) and other digital assets.

Despite the recent rise in interest of cryptocurrencies in Africa, Moroccan and Egyptian markets rarely make the news. While markets like South Africa, Nigeria, and Uganda have cryptocurrencies exchange services set up shop, the North African countries have largely remained underserved.

Part of the reason Morocco did not previously have any exchanges could be because transactions using digital currencies are considered de facto illegal. A year ago the Moroccan central bank, and the country’s Foreign Exchange Office, Office des Changes, declared that transactions using digital currencies such as bitcoin constitute a violation of the country’s exchange regulations.

Cryptocurrency enthusiasts in Egypt have been facing similar issues. From the Central Bank of Egypt asserting that no organisations have authority to trade bitcoin, to Dar Al Iftaa classifying cryptocurrencies forbidden by Islam, bitcoin has had no easy ride in the North African country. Still, there has been a growing interest in Egypt for blockchain technology as well as cryptocurrencies.

BitOasis is now an excellent alternative platform to peer-to-peer exchanges to buy bitcoin in Egpyt and Morrocco. Moreover, Egyptians and Moroccans are now also able to trade LTC, BCH, BSV, XRP, XLM, ETH, ETC, and ZEC.

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